Editas Medicine and BeiGene Gain in Market Debuts

By Leslie Picker

Feb. 3, 2016

After a volatile stock market kept initial public offerings of stock on the sidelines in January, two biotech companies are braving the waters.

Editas Medicine, which is producing a technology that corrects disease-causing genes, gained in its market debut on Wednesday. In midday trading, its shares were up about 6 percent. The company raised $94.4 million, pricing shares at the low end of the range it had marketed to investors.

BeiGene, a Chinese developer of drugs that target a body’s immune system to fight cancer, also rose in trading after generating $132 million. Its shares were up more than 19 percent in midday trading.

Pulling off an I.P.O. in the current market is a feat — especially for biotech companies, which recently experienced a sell-off after investors started abandoning what they perceived to be their riskiest positions. It was a shift from the previous two years, during which a surge of biotech companies made their public-market debuts.

There were 84 biotech companies that went public in the United States in 2014, the largest number on record, while last year 50 such companies conducted I.P.O.s, according to Dealogic.

Editas makes a gene-editing technology that is aimed at treating diseases for which the genetic causes are well understood. The company’s most advanced product would be used to treat a progressive form of blindness. Editas is also conducting research on preventing cancer, and it is teaming up with an immunotherapy company, Juno Therapeutics, to do so.

BeiGene, with a team of more than 215 scientists and other staff members, is creating a pipeline of oral drugs and antibodies to treat cancer.

Both companies plan to use proceeds from their initial offerings to fund clinical trials. They have several big-name biotech backers to help take them public during these rocky times. Hillhouse BGN Holdings and Baker Brothers said on the cover of BeiGene’s prospectus that they would buy half of the I.P.O. on the terms accorded to the other investors. Third Rock Ventures, Deerfield Management and Fidelity acquired stakes in Editas before its I.P.O.

Editas and BeiGene listed their shares on Nasdaq. Editas trades under the symbol EDIT, while BeiGene’s ticker is BGNE. Morgan Stanley and JPMorgan Chase advised Editas on its offering, and Goldman Sachs and Morgan Stanley managed the BeiGene offering.